The events in Greece are dominating both the national and international news this week. No surprise, because it is not often that you see a country slide inexorably into crisis, in part at its own making. What is less understood is the fact that five years ago, Greece's economy was in better state than the UK.
There are a number of differences between our economies. Whilst our debt and budget deficit was bigger than Greece's, there were - and still are - two notable differences. The first is that we pay our taxes in the UK: in Greece, they appear to be seen as optional. When the Greek government decided they would tax swimming pools, they were stunned that just 75 people admitted to having one. After the government announced that a cursory glance at Google Earth revealed an excess of 10,000 in the country, sales of lawn coloured pool covers went through the roof. They don't like paying taxes in Greece.
The second is their membership of the Euro. This, in itself, is controversial. The figures needed to meet Euro membership were fudged and massaged: Euro nations were happy to turn a blind eye to this to enlarge the Euro area. Being in the Euro has meant they have very limited control over money supply which is needed to encourage growth.
And if there were a third reason they are different from us, it is that they have failed to grasp the changes necessary to tackle their problems, still allowing (for example) people early retirement on full pensions.
Whilst there is a great sense of "told you so" about the Euro - and the UK is unique in Europe as being absolutely committed to staying out - the latter point about discipline is key, especially in the week we have our own budget. Having had five years of (relative to Greece) mild austerity, we are now in the home straight. Sticking with the plan to finish the job is vital because if we don't, our problems would escalate as they did in Greece. Greece is an extreme example, but Italy, Spain, Portugal - all have similar issues affecting them and these would probably get worse for them after a Greek Euro exit as investors would look for the next crisis. So whilst I would never try to pretend austerity has been easy, it's been a lot better than had we failed to stand up to our challenges.